Russian Oil Output Near Record as Lukoil Gains; Exports Decline

Russia boosted oil output to 10.21 million barrels a day in January, near a post-Soviet record, as state-controlled OAO Gazprom Neft ramped up output and OAO Lukoil halted monthly declines. Exports fell.

Output increased 1.6 percent from a year earlier and 0.5 percent from the previous month, according to preliminary data from the Russian Energy Ministry’s CDU-TEK statistics unit.

“Good figures, everything looks normal,” Alexander Nazarov, a senior energy analyst at IFC Metropol in Moscow, said by phone. “Lukoil wasn’t bad, as it halted month-on-month declines.”

Prime Minister Vladimir Putin said in October that Russia will produce about 10 million barrels a day for at least a decade. In the Soviet era, Russian crude output peaked in 1987 at 11.48 million barrels a day, according to BP Plc data. Output reached 10.27 million barrels a day in October.

Lukoil, Russia’s second-biggest oil producer, increased output by 0.8 percent from December, the first monthly growth since June, according to the statistics. Compared with a year earlier, the Moscow-based company’s production slumped 5.1 percent, reaching 1.75 million barrels a day.

Bashneft, an oil company controlled by billionaire Vladimir Yevtushenkov’s AFK Sistema, and Gazprom Neft, led in monthly output growth rates, Nazarov said. Daily output by Gazprom and OAO Novatek also rose, probably on the back of condensate increases, he said. Gas condensate, a liquid often produced along with natural gas, is included in Russia’s oil statistics.

Rosneft’s Vankor

Bashneft raised output 11.5 percent from a year earlier period and 2.5 percent from the previous month to 300,000 barrels a day. Gazprom Neft increased output by 1.1 percent from a year earlier and 2.5 percent from the previous month to 600,000 barrels a day.

OAO Rosneft, Russia’s biggest oil producer, boosted output by 3.4 percent from a year earlier and by 0.9 percent from the previous month to 2.3 million barrels a day, with the help of its Siberian Vankor deposit, the country’s largest new oil project.

Crude exports fell to 5.15 million barrels a day, a 2.4 percent decline from a year earlier and a 7.1 percent drop from the previous month, according to the data.

Natural-gas output fell 0.3 percent to 2.05 billion cubic meters a day from a year earlier. That amounted to a 1.5 percent gain from December.

‘Through the Roof’

OAO Gazprom, Russia’s biggest gas producer and its monopoly exporter of the fuel, produced 1.6 billion cubic meters in January, a decrease of 3.7 percent from a year earlier and 1 percent lower than the previous month, according to the data.

As Gazprom gas output retreated, Novatek’s output jumped 31 percent from a year earlier and 16 percent from the previous month, totaling 150 million cubic meters. This may indicate the smaller gas producer is gaining a bigger share of the domestic market, Nazarov said.

“Novatek’s output went through the roof,” Nazarov said. “It looks like Gazprom continues losing its market share in Russia but at the same used a positive gas spot market situation and also enjoys a cold winter in the EU.”

Gas export may help in terms of revenue to compensate for losing ground in the Russian market, he said.

To contact the reporter on this story: Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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